New amendment of it act u/s 194i ( tds applicability on use of plant and equipments)
Manoj Yadav
(Querist) 16 December 2011
This query is : Resolved
As per this new amendment by Income Tax now they have extended coverage of this section 194I which was applicalbe earlier on Rent payment only. But now after amendment it is applicalbe for "rent means any payment by whatever name called, under any lease, sub-lease, tenancy or any other agreement or arrangment for the use of (either seperately or together) any land, building (incl. Factory Bldg., machinery , Equipment, Furniture, fittings etc.. whether or not any or all are owned by the payee...."
Looking to above amendement we have to deduct TDS u/s 194I instead of u/s 194C which was @ 2.25% TDS for use of Vehicle, hire a crane, dozzer, tippper, Tractors and Truck. If we apply this section then rate of TDS will be @ 21% .
We seek your expert advice that what should be our arrangement / contract so that we have to deduct TDS @ 2.25% only? instead of Sec 194I. What should be revised contrat?
Guest
(Expert) 18 December 2011
The amendment is not new, but is 5 years old one. Since the amendment has become effective from July 13, 2006, you will have to deduct TDS @ 21%.
